Making allowance for the trends and risks of ESG investing when managing a portfolio of financial assets

Abstract

Aim. The presented study aims to investigate the trends and risks of ESG investing.Tasks. The authors determine the causes of the increasing popularity of socially responsible investment and analyze the relationship between the company’s compliance with ESG factors, its financial indicators, and its stability in the market.Methods. This study uses general scientific methods of cognition to examine socially responsible investment in various aspects and to identify trends in managing a portfolio of financial assets.Results. The authors propose the fundamentals of creating a new methodological framework for assessing the level of social and environmental responsibility of companies and provide recommendations for including socially responsible investment in the stock portfolio.Conclusions. The increasing popularity of the social responsibility of business makes it impossible to ignore ESG investing in the stock portfolio. However, when investing in a business, it is necessary to pay attention to the correctness of the results of company valuation. The ratings do not make allowance for companies partially complying with ESG factors.